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CAFA Law Blog Information, cases and insights regarding the Class Action Fairness Act of 2005

A Worthless Claim That is Worth Over $5 Million Can Get You Into Federal Court

Posted in Case Summaries

Marchione v. Pepsico, Inc., 2012 WL 140502 (M.D. Fla. Jan. 18, 2012).

Not only did the plaintiffs bring a worthless claim, it satisfied the amount in controversy and kept this case in federal court.

In this action, a District Court in Florida held that while determining the amount in controversy, the court can consider the claims requested in the response to interrogatories.

The plaintiff, employee of the defendants, filed a class action lawsuit (Case No. 8:11–cv–2607–T–30TBM) in the Florida state court claiming earned and unpaid wages under Chapter 448, Florida Statutes (the “Florida Wages Case”). The plaintiff claimed he and the putative class were not compensated for approximately 10–15 hours of “off-the-clock” work, and sought back pay, interest, attorneys’ fees and costs, and such other relief to which he may be justly entitled.

The plaintiff also filed a nearly identical collective action (Case No. 8:11–cv–2606–JSM–TGW) in the Florida state court seeking compensation under the Fair Labor Standards Act (“FLSA”) against the same defendants, on behalf of the same putative class of service technicians, and based on the same factual allegations of off-the-clock work as the Florida Wages Case.

The defendants subsequently removed the Florida Wages Case, as well as the FLSA Case, to the federal district court, based on satisfaction of CAFA’s diversity jurisdiction requirements.  

The plaintiff moved to remand the Florida Wages Case to the state court; whereas, the defendants filed a motion to consolidate both the actions. 

The District Court denied the motion to remand, and consolidated the actions.

In the District Court, the plaintiff did not dispute that the parties were diverse and that there were more than 100 persons in the putative class.  Thus, the sole issue before the Court was whether the amount in controversy exceeded $5 million under CAFA, 28 U.S.C. § 1332(d).  The Court concluded that it did.

As an initial point, the Court noted that the plaintiff’s claim under Fla. Stat. § 448.01 was shaky at best.  The Court pointed that the courts have held that § 448.01 is unconstitutional for vagueness and have expressly held that it is inapplicable to hourly employees like the plaintiff and the putative class here.  Thus, the Court was perplexed as to why the plaintiff filed this Florida claim, especially in light of the FLSA claim, which would provide duplicate damages.

The Court, however, stated that even if it was to assume that the Florida wages claim was a valid claim, which the Court stated it was not, the plaintiff’s argument in favor of remand, that is that the putative class would be seeking only unpaid wages and not overtime hours, was without merit.  The plaintiff’s answers to the Court’s interrogatories filed in the Florida Wages Case requested overtime hours of 15 hours at the overtime rate of $27.15.   (If the Court was to apply the plaintiff’s claim of $63,531 in overtime hours to 100 class members, the damages would exceed $5 million.) Applying the plaintiff’s own calculation, the overtime hours for the putative class and attorneys’ fees would exceed $5 million, the Court concluded. 

Accordingly, the Court denied the plaintiff’s motion to remand the Florida Wages Case to state court.